Correlation Between HR Capabilities And Financial Performance

Creating people advantage is based on a poll of 3,500 employer from 100 countries, together with in-depth interviews with 64 HR leaders and is conducted every 2 years.

The report found that companies with the best HR capabilities are among the top financial performers worldwide. The report suggests that companies in the top 100 for financial performance score higher for HR capabilities than those in the bottom 100. The 27 subtopics within HR include diversity management, employer branding and recruitment strategy.

Boston Consulting Group’s head of people and organisation practice Europe, Rainer Strack told HR magazine that while “correlation doesn’t always mean cause and effect”, the results do suggest the financial impact of HR can be “pretty huge”.

“This research will help HR to get a seat at the table,” he said. “To have a financial impact HR needs to go beyond qualitative measurements, and towards analytics and a focus on numbers”